Indian conglomerate Essar’s bid to take over its UK unit has been rejected by an independent committee set up by the subsidiary.

The committee was formed to consider the proposal from Essar Energy’s biggest shareholder, the Ruia brothers, and to protect the interests of minority shareholders.

The panel unanimously concluded that despite operational and Indian macro-economic challenges facing the business, a possible offer price of 70 pence per share clearly undervalues the London-listed oil and gas firm and its prospects.

The committee’s decision is viewed as a victory for minority shareholders, who felt the possible offer from Essar Global Fund Limited (EGFL) was “opportunistic.”

“The independent committee is unanimous in concluding that the current proposal from EGFL clearly undervalues the company and its long-term growth prospects.

“The independent committee is fully committed to safeguarding the interests of minority shareholders,” Philip Aiken, the chairman of the panel, said in a statement on Monday.

The Ruias, whose Essar Global group owns 78% of the shares in Essar Energy, had proposed on February 17 buying up the remainder stake. The indicative 70p a share offer valued Essar Energy at one-sixth its listing price in 2010.

The committee said that to supplement the advice it receives, Greenhill & Co has been appointed as additional financial adviser to JP Morgan Cazenove and that it was “fully committed to safeguarding” the interests of minority shareholders.

Investors in Essar Energy, which was listed on the London Stock Exchange in 2010 at 420p a share, had accused the Ruias of acting in a “cynical and opportunistic” manner by attempting to take the group private again.

Essar Energy shares traded at 63.60p at 1:05 pm local time, according to the company’s website. Minority investors such as Henderson Global Investors and Standard Life were vocal about their displeasure with the proposed offer, which they felt undervalued the company. The panel said there can be no certainty that any firm offer for the company will be made nor as to the terms on which such an offer might be made.